Just flipped my first house, but luckily i lived in the house first so i had a usda morgage loan with 5.25 interest. Now I want more, another house to flip, i bought another house but its the one i live in. How do I bORROW money to inevest in properties? i want rentals and flip potentials. Please any advise

Wed Dec 05, 2012 10:56 am

oldguySenior Member

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quote: How do I bORROW money to inevest in properties?

The same way that you borrow for a home, go to the lender and ask for a mortgage. But there are differences - a NonOwnerOccupied loan has about 1/2% to 1 1/2% premium over an OwnerOccupied. And a 20% down payment is required. The teaser offers that home buyers get don't apply for investors, no USDA loan, no 3.5% down payments, no TARP govt loans, etc.

But after you've done 2 or 3 your stash will be enough to buy/sell houses w/o much thoes rules being restrictive. And you don't really care what the interet rate is if you are only going to own it for less than a year. You may not need loans at all for the short flips, buy outright, fix & flip in 2 months. But you want good loans on the rental houses, 30-year fixed rate.

Wed Dec 05, 2012 4:20 pm

crews58Contributing Member

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old guy, thinks for the advice, u where def right. I walked into 3 banks today, and they gave me pretty much the same answer, I can buy low income properties, with a conventional loan, 20% down, 5% rate. Cant wait till the new year

Sat Dec 08, 2012 12:17 am

Maxwell01Member

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Simply put LVR’s are where a bank looks at the overall value of the property against the amount you are looking to borrow. Whereas a few years ago you may have only needed a small deposit to gain a loan, banks now require clients to have significantly higher deposits or equity. In short, they are looking to minimise their risks and increase their chances of recovery if you fail to service your loan.